Region News Briefs; 2 New Jersey Unions Sue State on Pensions

Published: October 19, 1994

TRENTON, Oct. 18—
Two of New Jersey's largest unions today filed suit against the state in Federal court over changes made to their pension systems.

The suit, filed by the New Jersey Education Association and the Communication Workers of America, charges that changes enacted by the Legislature in June violate due process and infringe upon the employees' property rights.

Gov. Christine Todd Whitman used the changes in pension payments to save more than $1 billion and to balance her first budget.

Under the new law, the state will delay the timing of its financing of medical benefits for retired public employees. Instead of paying all the money up front when employees are hired, the state will begin paying into those accounts on an annual basis. According to the lawsuit, the changes mean that the state contributions will drop sharply in future years, while contributions by the employees increase.